LITHIA MOTORS INC (LAD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LAD - US5367971034 - Common Stock
328.39 USD
+3.38 (+1.04%)
328.39 USD
0 (0%)
Overall LAD gets a fundamental rating of 5 out of 10. We evaluated LAD against 122 industry peers in the Specialty Retail industry. While LAD is still in line with the averages on profitability rating, there are concerns on its financial health. LAD has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year LAD was profitable.
LAD had a positive operating cash flow in the past year.
LAD had positive earnings in each of the past 5 years.
In multiple years LAD reported negative operating cash flow during the last 5 years.
1.2 Ratios
LAD has a Return On Assets of 3.67%. This is in the better half of the industry: LAD outperforms 63.93% of its industry peers.
LAD's Return On Equity of 13.28% is fine compared to the rest of the industry. LAD outperforms 72.13% of its industry peers.
With a Return On Invested Capital value of 5.53%, LAD perfoms like the industry average, outperforming 56.56% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for LAD is below the industry average of 11.71%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.67% | ||
| ROE | 13.28% | ||
| ROIC | 5.53% |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.4%
ROE(5y)18.55%
ROIC(3y)7.58%
ROIC(5y)8.54%
1.3 Margins
LAD has a better Profit Margin (2.39%) than 64.75% of its industry peers.
LAD's Profit Margin has been stable in the last couple of years.
LAD's Operating Margin of 4.47% is fine compared to the rest of the industry. LAD outperforms 64.75% of its industry peers.
In the last couple of years the Operating Margin of LAD has grown nicely.
LAD has a worse Gross Margin (15.40%) than 85.25% of its industry peers.
LAD's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.47% | ||
| PM (TTM) | 2.39% | ||
| GM | 15.4% |
OM growth 3Y-15.89%
OM growth 5Y2.61%
PM growth 3Y-21.85%
PM growth 5Y0.64%
GM growth 3Y-6.17%
GM growth 5Y-0.01%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), LAD is destroying value.
The number of shares outstanding for LAD has been reduced compared to 1 year ago.
The number of shares outstanding for LAD has been increased compared to 5 years ago.
The debt/assets ratio for LAD is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.46 indicates that LAD is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.46, LAD perfoms like the industry average, outperforming 57.38% of the companies in the same industry.
A Debt/Equity ratio of 2.07 is on the high side and indicates that LAD has dependencies on debt financing.
LAD's Debt to Equity ratio of 2.07 is on the low side compared to the rest of the industry. LAD is outperformed by 69.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.07 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.46 |
ROIC/WACC0.62
WACC8.89%
2.3 Liquidity
A Current Ratio of 1.21 indicates that LAD should not have too much problems paying its short term obligations.
LAD has a Current ratio of 1.21. This is comparable to the rest of the industry: LAD outperforms 43.44% of its industry peers.
LAD has a Quick Ratio of 1.21. This is a bad value and indicates that LAD is not financially healthy enough and could expect problems in meeting its short term obligations.
LAD has a Quick ratio of 0.30. This is in the lower half of the industry: LAD underperforms 72.13% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 0.3 |
3. Growth
3.1 Past
LAD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.64%, which is quite good.
Measured over the past years, LAD shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.64% on average per year.
The Revenue has grown by 8.42% in the past year. This is quite good.
LAD shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 23.35% yearly.
EPS 1Y (TTM)15.64%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%15.71%
Revenue 1Y (TTM)8.42%
Revenue growth 3Y16.59%
Revenue growth 5Y23.35%
Sales Q2Q%4.93%
3.2 Future
LAD is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.21% yearly.
Based on estimates for the next years, LAD will show a small growth in Revenue. The Revenue will grow by 5.36% on average per year.
EPS Next Y18.97%
EPS Next 2Y13.22%
EPS Next 3Y12.78%
EPS Next 5Y15.21%
Revenue Next Year4.72%
Revenue Next 2Y4.51%
Revenue Next 3Y5.07%
Revenue Next 5Y5.36%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.33, the valuation of LAD can be described as very reasonable.
LAD's Price/Earnings ratio is rather cheap when compared to the industry. LAD is cheaper than 86.89% of the companies in the same industry.
LAD's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.46.
Based on the Price/Forward Earnings ratio of 8.55, the valuation of LAD can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LAD indicates a rather cheap valuation: LAD is cheaper than 90.98% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of LAD to the average of the S&P500 Index (36.10), we can say LAD is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.33 | ||
| Fwd PE | 8.55 |
4.2 Price Multiples
63.93% of the companies in the same industry are more expensive than LAD, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 8.49 |
4.3 Compensation for Growth
LAD's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
LAD's earnings are expected to grow with 12.78% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.49
PEG (5Y)0.45
EPS Next 2Y13.22%
EPS Next 3Y12.78%
5. Dividend
5.1 Amount
LAD has a yearly dividend return of 0.68%, which is pretty low.
LAD's Dividend Yield is a higher than the industry average which is at 5.64.
Compared to an average S&P500 Dividend Yield of 2.32, LAD's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.68% |
5.2 History
The dividend of LAD is nicely growing with an annual growth rate of 11.85%!
LAD has paid a dividend for at least 10 years, which is a reliable track record.
LAD has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.85%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
LAD pays out 6.25% of its income as dividend. This is a sustainable payout ratio.
The dividend of LAD is growing, but earnings are growing more, so the dividend growth is sustainable.
DP6.25%
EPS Next 2Y13.22%
EPS Next 3Y12.78%
328.39
+3.38 (+1.04%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners103.57%
Inst Owner Change-6.4%
Ins Owners0.93%
Ins Owner Change-0.06%
Market Cap7.96B
Revenue(TTM)37.61B
Net Income(TTM)898.90M
Analysts83
Price Target401.84 (22.37%)
Short Float %8.9%
Short Ratio6.82
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.68% |
Yearly Dividend2.1
Dividend Growth(5Y)11.85%
DP6.25%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.07%
Min EPS beat(2)9.71%
Max EPS beat(2)10.43%
EPS beat(4)3
Avg EPS beat(4)6.29%
Min EPS beat(4)-1.6%
Max EPS beat(4)10.43%
EPS beat(8)5
Avg EPS beat(8)2.34%
EPS beat(12)6
Avg EPS beat(12)0.85%
EPS beat(16)8
Avg EPS beat(16)1.96%
Revenue beat(2)1
Avg Revenue beat(2)-0.38%
Min Revenue beat(2)-2.05%
Max Revenue beat(2)1.29%
Revenue beat(4)2
Avg Revenue beat(4)-0.69%
Min Revenue beat(4)-2.33%
Max Revenue beat(4)1.29%
Revenue beat(8)2
Avg Revenue beat(8)-1.8%
Revenue beat(12)3
Avg Revenue beat(12)-1.77%
Revenue beat(16)5
Avg Revenue beat(16)-1.11%
PT rev (1m)0.37%
PT rev (3m)-1.1%
EPS NQ rev (1m)1.59%
EPS NQ rev (3m)4.3%
EPS NY rev (1m)1.23%
EPS NY rev (3m)0.23%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)3.44%
Revenue NY rev (1m)0.64%
Revenue NY rev (3m)1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.33 | ||
| Fwd PE | 8.55 | ||
| P/S | 0.21 | ||
| P/FCF | N/A | ||
| P/OCF | 27.01 | ||
| P/B | 1.18 | ||
| P/tB | 5.12 | ||
| EV/EBITDA | 8.49 |
EPS(TTM)35.19
EY10.72%
EPS(NY)38.43
Fwd EY11.7%
FCF(TTM)-1.75
FCFYN/A
OCF(TTM)12.16
OCFY3.7%
SpS1550.95
BVpS279.12
TBVpS64.2
PEG (NY)0.49
PEG (5Y)0.45
Graham Number470.11
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.67% | ||
| ROE | 13.28% | ||
| ROCE | 9.34% | ||
| ROIC | 5.53% | ||
| ROICexc | 5.58% | ||
| ROICexgc | 7.25% | ||
| OM | 4.47% | ||
| PM (TTM) | 2.39% | ||
| GM | 15.4% | ||
| FCFM | N/A |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.4%
ROE(5y)18.55%
ROIC(3y)7.58%
ROIC(5y)8.54%
ROICexc(3y)7.8%
ROICexc(5y)8.76%
ROICexgc(3y)10.26%
ROICexgc(5y)11.04%
ROCE(3y)12.38%
ROCE(5y)13.83%
ROICexgc growth 3Y-22.88%
ROICexgc growth 5Y-1.28%
ROICexc growth 3Y-24.14%
ROICexc growth 5Y-3.26%
OM growth 3Y-15.89%
OM growth 5Y2.61%
PM growth 3Y-21.85%
PM growth 5Y0.64%
GM growth 3Y-6.17%
GM growth 5Y-0.01%
F-Score6
Asset Turnover1.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.07 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 7.03 | ||
| Cap/Depr | 107.01% | ||
| Cap/Sales | 0.9% | ||
| Interest Coverage | 2.34 | ||
| Cash Conversion | 14.78% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.21 | ||
| Quick Ratio | 0.3 | ||
| Altman-Z | 2.46 |
F-Score6
WACC8.89%
ROIC/WACC0.62
Cap/Depr(3y)135.76%
Cap/Depr(5y)158.69%
Cap/Sales(3y)0.93%
Cap/Sales(5y)1.04%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)15.64%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%15.71%
EPS Next Y18.97%
EPS Next 2Y13.22%
EPS Next 3Y12.78%
EPS Next 5Y15.21%
Revenue 1Y (TTM)8.42%
Revenue growth 3Y16.59%
Revenue growth 5Y23.35%
Sales Q2Q%4.93%
Revenue Next Year4.72%
Revenue Next 2Y4.51%
Revenue Next 3Y5.07%
Revenue Next 5Y5.36%
EBIT growth 1Y7.78%
EBIT growth 3Y-1.94%
EBIT growth 5Y26.57%
EBIT Next Year17.12%
EBIT Next 3Y11.35%
EBIT Next 5Y10.99%
FCF growth 1Y91.95%
FCF growth 3Y-63.67%
FCF growth 5Y-28.69%
OCF growth 1Y209.27%
OCF growth 3Y-38.16%
OCF growth 5Y-4.12%
LITHIA MOTORS INC / LAD FAQ
What is the fundamental rating for LAD stock?
ChartMill assigns a fundamental rating of 5 / 10 to LAD.
What is the valuation status of LITHIA MOTORS INC (LAD) stock?
ChartMill assigns a valuation rating of 6 / 10 to LITHIA MOTORS INC (LAD). This can be considered as Fairly Valued.
How profitable is LITHIA MOTORS INC (LAD) stock?
LITHIA MOTORS INC (LAD) has a profitability rating of 5 / 10.
How financially healthy is LITHIA MOTORS INC?
The financial health rating of LITHIA MOTORS INC (LAD) is 2 / 10.
Can you provide the dividend sustainability for LAD stock?
The dividend rating of LITHIA MOTORS INC (LAD) is 6 / 10 and the dividend payout ratio is 6.25%.